He said the WHO had "failed in its basic duty" in its response to the coronavirus outbreak.
He accused the UN body of mismanaging and covering up the spread of the virus after it emerged in China and said it must be held accountable.
Mr. Trump has previously accused the WHO of being biased towards China.
The US president has himself come under criticism at home over his handling of the outbreak.
"I am directing my administration to halt funding while a review is conducted to assess the World Health Organization's role in severely mismanaging and covering up the spread of the coronavirus," Mr.Trump told a news conference at the White House.
"The WHO failed in its basic duty and it must be held accountable," he added.
Reacting to Mr. Trump's remarks, UN Secretary-General António Guterres said now was "not the time" to be cutting resources for the WHO.
The US is the WHO's biggest single funder, providing $400m (£316m) last year - just under 15% of its total budget.
China's contribution in 2018-19 was almost $76m in assessed contributions and about $10m in voluntary funding, according to the WHO website.
The organization launched an appeal in March for $675m to help fight the pandemic and is reported to be planning a fresh appeal for at least $1bn.
"With the outbreak of the COVID-19 pandemic, we have deep concerns whether America's generosity has been put to the best use possible," the president said.
The US is the worst-affected country in the coronavirus pandemic with 608,377 cases and 25,981 deaths.
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